Minnesota State Auditor and
DFL candidate for Minnesota governor Rebecca Otto lays out the first
three parts of her five-part Renew Minnesota Agenda: the
Minnesota-Powered Plan, the Healthy Minnesota Plan and the 15-5-2
Plan. The remaining two parts of the plan, which have not been
released yet, will deal with transportation and education.

The Minnesota-Powered Plan, Otto says,
gets at climate change and will create up to 250,000 jobs in the
clean-energy economy. She says the Healthy Minnesota Plan would move
Minnesota to a single-payer, universal health care system, which
would reduce the overall cost of providing health care to
Minnesotans by about 15 percent.

Otto's 15-5-2 Plan calls for a $15 minimum
wage statewide, phased in over five years, and two years of free
postsecondary tuition in the Minnesota State system (formerly the
Minnesota State Colleges and Universities or MnSCU system) for high
school graduates and people who've earned a GED. She says the free
tuition plan would cost $229 million for a biennium.

Otto says we need long-term financial
planning in transportation. She would consider an increase in the
gas tax, although she says the tax will have diminishing value over
time as we transition away from fossil fuels to electricity. She
believes transit is critical for a strong economy and notes Greater
Minnesota's need for bus service.

She supports keeping the Metropolitan
Council an appointed body and thinks it would be valuable to have a
State Planning Agency again. She favors empowering teachers and
believes early childhood education is critical. Otto says the
legislative process is broken, with a lack of transparency and
accountability, decisions being made behind closed doors by a very
few people, the erosion of the committee structure and the
Legislature ignoring the state Constitutional requirement that every
bill must be restricted to a single

Rebecca Otto is the Minnesota State
Auditor and a DFL candidate for governor of Minnesota. She was first
elected State Auditor in 2006 and is currently serving in her third
term. Otto oversees $20 billion spent annually by local
governments. She serves on six state boards: the Rural Finance
Authority; the Land Exchange Board; the Minnesota Housing Finance
Agency; the Minnesota State Board of Investment, which invests over
$80 billion; the Public Employees Retirement Association of
Minnesota and the Minnesota Executive Council.

Otto served as a State Representative in
the Stillwater area from 2003 to 2005. She served on the following
House committees: Agriculture and Rural Development Finance,
Agriculture Policy, Environment and Natural Resources Policy, and
Local Government and Metropolitan Affairs. Prior to her election to
the Legislature, she served on the Forest Lake School Board and
chaired a successful $52 million school levy campaign.

Previously, Otto taught seventh-grade life
science for five years in the Mounds View Public Schools. Before she
was a teacher, she started and grew a 50-employee painting,
decorating and historic restoration business and later sold it.

Otto received her B.A. degree in biology
from Macalester College in 1985 and her Master's of Education degree
from the University of Minnesota in 1994. She lives on a small farm
in Washington County's May Township in a renewable energy-powered
home she and her husband built.

Background

Continuing its focus on
Minnesota's competitiveness, since September 2015, the Civic Caucus
has been undertaking a review of the quality of Minnesota's
public-policy process for anticipating, defining and resolving major
community problems. On November 27, 2016, the Caucus issued a report
based on that review, Looking
Back, Thinking Ahead: Strengthening Minnesota's Public-Policy
Process.

As part of that look at Minnesota's
public-policy process, the Civic Caucus began a series of interviews
in October 2017 with major, announced candidates for the office of
governor of Minnesota.The interviews are centered on what can be
done to keep Minnesota and its people competitive in a number of
realms. This interview with State Auditor Rebecca Otto is the
seventh in that series.

Discussion

Opening Remarks.

State Auditor Rebecca Otto said she'll be
an evidence-based governor. As a former science teacher, Otto
believes research and evidence is extraordinarily important.

Long-term financial planning and making
sure people can trust their government has been important in all the
elective offices Otto has held. "I know when people can trust
their government, they tend to support their government," Otto said.
"We are known as a good-government state nationally and
internationally. The U.S. State Department has sent people from all
around the world to Minnesota, because they want to know how we do
it."

One delegation was fascinated that we
require transparency, audits and reporting, Otto said. When people
hire lobbyists, that's public. "We have all these mechanisms to make
sure we can trust our government and that has served us very, very
well," she said.

"We want good government," she said. "We
don't want waste, fraud or abuse. In Minnesota, we like to lead the
nation in good public policy and we care about the common good."

Governor Mark Dayton and former Governor
Arne Carlson both served as state auditors before becoming governor.
Otto said both governors told her that state auditor is one of the
best jobs you can ever have in government. They said the auditor
gets to see how all the money flows from federal to state to local
and knows how all the programs work.

The auditor serves on the Minnesota
Housing Finance Agency Board, the Rural Finance Authority, the Land
Exchange Board, the Minnesota State Board of Investment, the Public
Employees Retirement Association and the Executive Council. And the
auditor works with local governments from around the state and
understands the strengths and challenges of Minnesota's communities.

When Minnesota's economy is doing well, we
can invest in the things that make us very special. Otto said we
should invest to ensure we have strong intellectual capital, are a
good-government state and are protecting our natural resources.

Not all Minnesotans are able to engage in
the economy in a meaningful way and we have some gaps in education.
"That's something we need to have a greater sense of urgency
around," Otto said, "so we have equality of opportunity." When Otto
announced her campaign in January 2017, she launched a statewide
listening tour in order to understand people's hopes and dreams and
their concerns and struggles.

There are reasons Minnesota hasn't grown a
3M or a Medtronic in a long time. "When our economy is doing
well and we are competitive, we can attract the innovators and we
can have homegrown businesses," Otto said. As work is getting
mechanized and automated, she said, we have to plan for it. And as
our population ages and people leave the workforce, we have to
understand what that means for the state's future revenues.

Otto's Renew Minnesota Agenda: Renewable
energy,

single-payer health care, $15 minimum
wage and two years free tuition

Otto's Renew Minnesota Agenda has five
parts and she has released three of them to date.

1.

The Minnesota-Powered Plan.
Otto said this part of her agenda gets at climate change, while
creating up to 250,000 good-paying, 21st century jobs. "It's going
to empower Minnesotans to do something very different by accessing
the clean-energy economy," she said. "I want to put Minnesota on the
cutting edge of the clean-energy economy. We started years ago--and
it's been a very bipartisan effort--but we are slipping behind. My
plan will create small businesses and opportunities statewide."

2.

The Healthy Minnesota Plan.
Otto said this plan would move Minnesota to a single-payer,
universal health care system. "It's guaranteed, publicly financed,
quality and we're going to reduce costs and increase health
outcomes," she said. "If you're a Minnesotan, you're covered. We
must and can do this as a state."

The plan will get rid of making our health
care providers do coding, billing and pre-authorizations, Otto
explained. "Get that out of the way," she said. "We incent and
reward them for keeping us all healthy." People will choose their
own providers and there will be a reimbursement per enrollee, rather
than a fee for service. "It's going to allow Minnesotans to make
better life decisions," she said, such as deciding when it's best to
retire.

She said the countries that have
single-payer health care are the ones that are attracting innovators
and growing businesses.

3.

The 15-5-2 Plan. Otto said
this plan calls for a $15 minimum wage statewide, phased in over
five years, and two years of free postsecondary tuition in the
Minnesota State system (formerly the Minnesota State Colleges and
Universities or MnSCU system). "We value work," she said. "If you
work 40 hours per week, you should be able to come close to
supporting yourself."

The two years of free tuition in the
Minnesota State system would be available for high school graduates
or people who've earned a GED. Students getting free tuition would
be required to maintain a 2.5 or better grade-point average, perform
25 hours of community service over the two years, have a mentor
relationship in their chosen field and stay in Minnesota for four
years after completing the tuition-free two years of school. "This
says to the nation that we have the workforce of the 21st century,"
Otto said.

The remaining two parts of the Renew
Minnesota Agenda will deal with transportation and education, Otto
said.

Fifty percent of our health care is funded
by the federal and state governments. Otto said under the
single-payer plan, all of that funding would go into a protected
single fund at the state level. Employers are already spending a lot
of money, she said, so we would tell employers we're going to reduce
costs. The Legislature could determine broad-based payroll taxes or
other funding plans that would be fair to employers.

Otto said her single-payer plan would
reduce the overall cost of providing health care to Minnesotans by
about 15 percent. "We're going to get the administrative burden
out of the way and ask our providers to focus back on health and
keeping us healthy," Otto said. "We will define a standard set of
benefits as a state. We won't get totally away from fee-for-service,
but getting to an upfront quarterly reimbursement per enrollee will
incent providers to innovate and to reduce the cost of keeping their
patients healthy. We can and we must do something better."

Otto said many doctors are supporting her
plan because the current system is "burning them out. They want joy
to be brought back to practicing medicine." She said the
single-payer system will allow medical innovation and will incent
and reward coordinated care, like the Mayo Clinic provides.

Higher Education.

What is keeping people away from
postsecondary opportunities? An interviewer asked that question
and Otto said we're creating so many barriers now: students and
their families have to take on so much debt; students from families
where no one has had a postsecondary education don't know how to
access it; and students whose families are living hand-to-mouth or
are transient, moving all the time, don't see postsecondary
education as an option, because it's a struggle just to survive.

Providing two years of free tuition at
Minnesota State institutions would cost $229 million for a
biennium. Otto believes the business community would support the
free-tuition plan, because they would have a trained workforce.

An interviewer commented that somehow we
have to organize our communities and our institutions to be on same
page, so the message about access to education is consistent. "We
must reinforce that message outside the classroom," he said.

Transportation

We need long-term financial planning in
transportation. Otto said there's a disconnect between the
Legislature and the Minnesota Department of Transportation (MnDOT).
The Legislature wants to know how MnDOT selects projects. As
governor, she said, she would change how MnDOT is communicating and
make sure the Legislature trusts MnDOT's process.

When we regularly maintain infrastructure,
it has a longer life, Otto said. When we defer maintenance, it's
going to cost us more. "I want to get to a system that is long-term
and stretching our dollars as far as they can go," she said. She'll
have a plan for transportation coming out as part of her Renew
Minnesota Agenda, she said.

Transit is critical for a strong economy.
Otto said employers support transit. We need public transportation
because young people don't want or can't afford cars and we're an
aging population and can't drive forever. She said Greater Minnesota
wants bus service, especially seniors.

Otto said she would consider an increase
in the gas tax. The gas tax has value, but will have diminishing
value over time, she said. Her Minnesota-Powered plan moves away
from fossil fuels to electricity. The plan would allow people
replacing a car to get 30 percent off an electric vehicle, new or
used.

"We must have an open and honest
conversation about how we will fund roads as we transition away from
fossil fuels," she said.

Otto said Minnesota has a pilot project
with three driverless buses that have been tested in rural parts of
the state. The bus is controlled remotely.

The Metropolitan Council.

There would be a conflict of interest if
the Metropolitan Council were appointed directly by counties and
cities, rather than by the governor. Governors are accountable
for the appointments they make, Otto said, so they should think
carefully about whom they appoint. She said every governor has
protected the Met Council and its role in regional planning.

The State Planning Agency.

It would be valuable to have a State
Planning Agency again. The State Planning Agency was created in
1965 and abolished in 2003. "We must do long-term planning
and have someone focusing on that," Otto said. "Otherwise you watch
the Legislature go in circles. It is not good for us as a state.
When you see projects picked because of who's in control of the
Legislature, that's not the right way to do it, either."

K-12 Education.

How can we persuade K-12 district school
boards and, sometimes, superintendents who are deeply into control
to allow schools to change anything? An interviewer asked that
question and said we should allow teachers and principals to adapt
to the needs they see and the students they have. The interviewer
said the public school district sector has a hard time picking up on
innovation, because of school boards' "remorseless preference for
sameness across the schools and down through time."

The interviewer noted that since state
revenues now cover about three-quarters of public school financing,
we could think of public education as a single-payer system.

Otto replied that when a teacher has a
class with 40 children, it's very hard to give individual attention
to every student. We educate children by age, but two children the
same age can be very different in what they can accomplish. What a
child's early, early--including prenatal--experiences are makes a
big difference. "If you have a child with chaos in the home and
who's moving constantly, it's very hard for teachers to make
progress," she said.

We should empower our teachers. An
interviewer asked Otto whether, if a governor wants to change
something in education, the governor should put chips on expanding
what teachers can do or on expanding what school boards can do.
"Teachers, teachers, teachers," Otto responded. She said we need to
do more as a state to utilize the University of Minnesota's research
capacity, with a real sense of urgency, to focus on what we need to
do to have all our children succeeding.

She said people are demonizing teachers
today. It's hard to make progress with children who are worried
about their next meal or violence in their home, she said. As a
state we have not been funding schools to keep up with inflation.
Our schools are subsidizing special education, because the federal
government has never fully funded special education, she said.
School budgets are strained.

Otto said children succeed when their
parents are involved in their education--showing up for
parent-teacher conferences, having books in the home, helping their
children with homework and having meals together.

Early childhood education is critical.
"It's an intervention we can use for our most at-risk kids," Otto
said.

The Legislative Process.

The legislative process is broken.
Otto said there is a lack of transparency and accountability,
decisions are made behind closed doors by a very few people and the
state Constitutional requirement that every bill must be restricted
to a single subject is ignored.

"This is not working," Otto said of
ignoring the single-subject requirement. "Garbage bills are how you
play monkey business and how you run over what the founders
contemplated: a single subject and a title that would reflect the
content of the bill." Otto said the State Supreme Court has not
wanted to weigh in on this issue for decades. "If they don't do it
now, I don't know when," she said.

"It's not political," she said. "It's
absolutely critical that we get this done as a state so the people
understand what's happening in their government. Right now, big
money rules. If we are successful on that single-subject case, that
would be game-changing for us."

An interviewer asked if Otto would pledge
that as governor, she would not sign bills that violated the
single-subject rule. Otto replied that she wants to wait to see what
the Supreme Court does in her case first.

The Legislature should be subject to the
state's Open Meeting Law. "They're doing a lot behind closed
doors and things are being decided by too few people," Otto said.
"As governor, you have to manage the Legislature, be clear about the
expectations, and say what you mean and mean what you say."

The committee structure and so much has
eroded at the Legislature. Otto noted that the Legislature is
passing fewer bills than ever. "What they're doing is hearing
policy, taking no action and then laying it over for possible
inclusion in the Omnibus bill," she said. "Because they take no
action, nothing shows up in the legislative bill tracker and we
can't follow the process anymore. That is really bad."

The Civic Caucusis a nonpartisan,
tax-exempt educational organization. The Interview Group
includes persons of varying political persuasions,
reflecting years of leadership in politics, public policy,
business, nonprofits and government.
Click here to see a short personal background of each.